Newspaper advertising enjoys a 10% tax rate
If a 10% tax rate is applied, it is expected that the 2014 budget revenue for just the four major TV stations will decrease by about 460 billion VND.
To remove difficulties for press agencies, the draft Government Submission on the Project Law amending and supplementing a number of articles of the Law on Corporate Income Tax proposes to add income from print newspaper activities (including newspaper advertising) of press agencies according to the provisions of the Press Law to the scope of application of the tax rate of 10%.
According to the provisions of the Press Law, press products are cultural products. The press operates not for profit and carries out political tasks assigned by the Party and the State.
In fact, in the recent past, the distribution activities of most press agencies have suffered losses and had to use advertising revenue to compensate. In particular, printed newspapers in 2011, including both distribution and advertising activities, also suffered losses. Visual newspapers were less affected than printed newspapers (according to tax settlement data in 2011, only 4 major television stations paid corporate income tax of 536.312 billion VND, of which: Hanoi television station paid corporate income tax of 10.92 billion VND, Vietnam television station paid 277.971 billion VND, Ho Chi Minh City television station paid 154.531 billion VND, Vinh Long television station paid 93.090 billion VND).
To remove difficulties for press agencies in print activities, creating conditions to help press agencies have resources to perform well the assigned political tasks, the Ministry of Finance submitted to the Government to submit to the National Assembly to amend and supplement Clause 2, Article 13 of the Law on Corporate Income Tax in the direction of adding regulations that income from print activities (including newspaper advertising) of press agencies established and operating under the Press Law is subject to a tax rate of 10% (other activities of press agencies such as real estate transfer, event organization, hotel and tourism business are subject to the general tax rate).
Tax incentives are not applied to other types of press (visual press, radio press, electronic press), because: in reality, other types of press have encountered less difficulties than print press (in 2011, only 4 major TV stations paid about 536 billion VND in corporate income tax); if the 10% tax rate is applied to TV stations, the expected reduction in 2014 budget revenue is large; only 4 major TV stations (Vietnam Television, Hanoi Television, Ho Chi Minh City Television and Vinh Long Television) are expected to reduce 2014 budget revenue by about 460 billion VND compared to the tax rate of 23%; TV stations are implementing their own mechanisms according to the guidance in Circular 55/2010/TT-BTC of the Ministry of Finance and have no recommendations on corporate income tax incentives; There is a precedent for more preferential policies for print newspapers (before 2003, print newspapers were given back the actual corporate income tax paid to the central budget to invest in facilities, and non-print newspapers with income from advertising and service businesses still paid corporate income tax at the tax rate of 32%).
The draft also proposes to add income from publishing activities as prescribed by the Publishing Law to the scope of application of the 10% tax rate./.
According to (vov.vn) - LT
